BoT says interest rate increased to mobilize money

August 19th, 2008 - 1:57 pm ICT by Amrit Rashmisrisethi  

Deputy Governor of the Bank of Thailand (BoT) Bandid Nijathaworn (บัณฑิต นิจถาวร) says he believes that the short-term interest rate increase is commercial banks’ mobilization of money in the time of liquidity crunch.

The deputy governor says the interest rate increase by commercial banks is in line with the monetary market. The banks decided to raise the interest rate to mobilize money in preparation for the release of more loans. He says the second quarter’s loan release has risen by 11% compared to the first quarter and expresses his belief that the interest rate increase will benefit savers.

Mr Bandid also says the political situation, especially the rumors of party dissolution and parliamentary dissolution, will not affect commercial banks’ operations during the second half of the year. However, the deputy governor warns against the global economic slow down but says the country’s economy will grow if the government spends more and the inflation rate starts to drop.

Source : National News Bureau, Public Relations Department of Thailand

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